Retail Investors viewpoint regarding investment in Mutual Funds and Stock Market: A Comparative Study

Abstract

The stock market and mutual funds are frequently seen by retail investors as vital parts of their financial portfolios. Because they are professionally managed and diversified, mutual funds are generally preferred over individual stocks because they lower the risk involved in selecting individual stocks. Those conservative investors looking for steady, long-term growth may find this appealing. Their allure is further increased by their accessibility, systematic investment plans (SIPs), and capacity to invest in multiple asset classes inside a single fund (Srivastav & Mittal (2016). Conversely, investors with a higher risk tolerance find the stock market appealing since it offers direct equity investments with the potential for large profits. Stocks are frequently viewed by retail investors as a means of profiting from company-specific growth prospects and market swings. They are conscious of the dangers, though, including the necessity for ongoing observation and market volatility (Dhar & Banerjee, 2021). All things considered, the stock market has the attraction of larger returns but comes with more risk than mutual funds, which provide a safer, more detached approach. Sample of 212 retail investors were surveyed to compare their viewpoint regarding investment in Mutual Funds and Stock Market and found that there is significant difference between stock market and mutual fund investment.